C S Chandrashekar Vs Sri Krishnappa

THIS CIVIL.MISC.PETITION IS FILED UNDER SECTION 11(6) OF THE ARBITRATION AND CONCILIATION ACT, 1966, PRAYING THAT THIS HON’BLE COURT PRAYS THAT (A) AN ARBITRATOR BE APPOINTED TO RESOLVE THE DISPUTE THAT ROSE BY THE MEMORANDUM OF UNDERSTANDING DATED 19.01.2017 AND ETC.,

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THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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NC: 2026:KHC:10280 CMP No. 461 of 2024

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HC-KAR

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CORAM: HON'BLE MR. JUSTICE ASHOK S.KINAGI

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ORAL ORDER

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The petitioner has filed this Civil Miscellaneous Petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, ‘the Act’) for the appointment of an arbitrator in terms of the unnumbered clause in the Memorandum of Understanding dated 19.01.2017 vide Annexure-A as per the Provisions of the Act.

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Brief facts, leading rise to the filing of this petition are as follows:

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The petitioner was the absolute owner of the land bearing Survey No.25/4 measuring 27 guntas and 5 other properties situated at Dhabanugunda-Malur, Channapatna Taluk.

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It was agreed between the petitioner and the respondents that respondent Nos.1 to 3 would purchase 27 guntas of the said property along with 5

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other properties at the rate of ₹2,75,000/- per gunta and entered into a Sale Agreement on 30.12.2016. Prior to the execution of the sale deed, the part of the said property i.e., 13 guntas out of 27 guntas was notified for acquisition for the purpose of widening of the national highway between Bangalore and Mysore by the Special Land Acquisition Officer, National Highway Authority of India. The petitioner and respondent Nos.1 to 3 entered into a Memorandum of Understanding dated 19.01.2017. On 08.12.2017, in respect of 13 guntas of land acquired, the National Highway Authority of India passed an award, and respondent Nos.1 to 3 are trying to receive the entire award amount without giving the petitioner's share of amount as agreed under Memorandum of Understanding dated 19.01.2017.

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There is an arbitration clause in Memorandum of Understanding dated 19.01.2017 and the petitioner

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invoked the arbitration clause by issuing a notice under Section 21 of the Act on 18.01.2024.

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The respondents replied to the arbitration notice on 26.02.2024, vide Annexure ‘C’. The respondents did not agree for the appointment of an arbitrator on the ground that there is no arbitral dispute between the petitioner and the respondents. Hence, a cause of action arose for the petitioner to file a petition. Accordingly, prays to allow the petition.

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Although, the Court notice was issued to the respondents, despite service of notice, the respondents remained unrepresented.

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Heard the arguments of the learned counsel for the petitioner, and perused the records.

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The point that would arise for consideration is as follows:

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“Whether the petitioner has made out a ground to refer the arbitral

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dispute between the parties to the petition to the arbitrator in terms of unnumbered clause in the Memorandum of Understanding dated 19.01.2017 as per the provisions of the Act and the Rules?”

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It is an undisputed fact that the petitioner and the respondents have entered into a Memorandum of Understanding dated 19.01.2017. Dispute arose regarding the compensation regarding the land acquired by the National Highway Authority i.e., to the extent of 13 guntas, wherein the petitioner is also entitled to a share in the compensation amount. The petitioner requested the respondents to pay the compensation amount. The respondents did not pay the compensation amount. There is an arbitration clause in the Memorandum of Understanding dated 19.01.2017, which reads as under:

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“In the event of there being any dispute with regards to this agreement or under this agreement or interpretation of

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any of the terms and conditions of this agreement the same shall be referred to arbitration of a sole Arbitrator to be appointed by the parties as per the provisions of Arbitration and Conciliation Act,1996 and such Arbitration shall be in English. The seat of such Arbitration shall be at Bangalore.”

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From the perusal of the arbitration clause, it discloses that if any dispute or difference arises out of the terms and conditions of the Memorandum of Understanding, the said dispute shall be referred to an arbitration.

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The petitioners invoking the arbitration clause, issued a notice dated 18.11.2024 to the respondents invoking Section 21 of the Act proposing the name of an arbitrator.

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The respondents replied to the arbitration notice on 26.02.2024 declining to accept the name proposed by the petitioner as an arbitrator.

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HC-KAR

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Admittedly, there is an arbitration clause in the Memorandum of Understanding dated 19.01.2017 and that an arbitral dispute arose between the petitioner and the respondents, and the said arbitral dispute has to be resolved through an arbitration.

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The petitioner has made out the ground to refer the dispute to the arbitrator. For the forgoing discussion, the point is answered accordingly.

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In view of the above discussion, I proceed to pass the following order:

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ORDER

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(i) These Civil Miscellaneous Petitions are allowed .

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(ii) Sri. Rama Rao Kulkarni, Retired District Judge, is nominated as an arbitrator to resolve the dispute between the parties to the petitions in terms of Unnumbered clause of the Memorandum of Understanding dated 19.01.2017, as per the

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provisions of the Arbitration and Conciliation Act, 1996 and the Rules.

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(iii) The Registry is directed to communicate this order to the learned Arbitrator and the Director of the Arbitration and Conciliation Center, Bangalore.

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(iv) All the contentions of the parties are kept open.

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(v) The Registry is directed to return the original and/or certified copies, if produced, to the respective parties who have produced it/them by following due procedure.

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(vi) Pending application/s, if any, shall stand disposed of accordingly.

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Sd/(ASHOK S.KINAGI) JUDGE

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RK List No.: 1 Sl No.: 45

C S Chandrashekar v. Sri Krishnappa

Case brief

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C S Chandrashekar v. Sri Krishnappa

Case brief

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